Textile, PSU packages affected by undue delay in fund release
The inordinate delay on the part of the Finance Department in releasing the budgetary allocation is understood to have upset the execution of the textile sector revival package and the development initiatives of some major public sector undertakings (PSUs) in the State.
Official sources told The Hindu here on Sunday that a sum of Rs.60 crore was set aside in the Budget for 2012-13 for launching a special revival package exclusively for the textile industry. The Finance Minister had also promised support for modernising Edarikode Textiles that was celebrating its platinum jubilee.
The slew of measures announced in the Budget was expected to come as a breather to the textile sector which is reeling under a crisis. The acute scarcity and soaring cost of raw materials besides the mounting power bills continued to smother the mills. Mill managements found the going tough and it was feared that the crisis would eventually lead to a shutdown. The Kerala State Electricity Board (KSEB) had cut the power connections of certain defaulting mills, the sources said.
A sum of at least Rs.25 crore had to be invested to make the three new mills opened during the tenure of the LDF government at Komalapuram (in Alappuzha district), Kasaragod, and Kannur to become fully functional. The Industries Department had worked out a plan for reviving the sector and also to make the new mills fully operational. The funds offered under the package were proposed to be used for meeting such immediate needs. Implementation of all such proposals had been stymied and now it had become uncertain, sources said.
The budgetary allocation for industries during the year was pegged at Rs.130.30 crore. With just two months left for the current financial year to end, release of a sizeable component of the allocation remains entangled in procedural delays. The cashew sector was one which bore the brunt of the delayed fund release. Allocations for various sectors were made against the proposals placed by them and delayed release of the funds at the fag end of the financial year would mean that the expenditure would be a mere ritual.
The government had rolled out an action plan for increasing the efficiency of the PSUs and infuse professionalism in their management. Certain initiatives like e-tendering and procurement have been launched too. Support to the traditional industries sector was one of the highlights of the action plan. The skewed priorities in providing funds and the laxity in timely release would affect the development programmes charted out by the government, sources said.